Evidential burden requires the assessee to prove nature, origin and year of loss of bad debts; absence of contemporaneous records defeats deduction.

Evidential burden lies on the assessee to prove that disputed amounts were loans arising within the registered money lending business, to establish their nature and origin, and to show they became irrecoverable in the year claimed; absent the original mortgage deed, transaction particulars, contemporaneous ledger entries showing interest or payments, and balance sheet treatment for the year, the bad debt deduction was not established. After produced extracts not placed before tax authorities cannot sustain a revision of factual findings, and the Commissioner's disallowance of the deduction was upheld on the available evidence.

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Issues: Whether the Commissioner of Income-tax was obliged in law to allow the assessee firm a deduction for alleged bad debts claimed in the year of account, and whether the Commissioner misapplied legal principles in disallowing the deduction.

Analysis: The debts relied upon were described in a mortgage-bond as three distinct items, the largest arising from a partner-account in a jute business rather than a loan from the money-lending business; supporting documentary evidence such as the original mortgage deed, particulars of the transactions, entries showing interest or payments, and annual balance sheet treatment were not produced for the year of account. The books for the year showed carry-forward entries and a later write-off but no contemporaneous proof that the debts were loans within the registered firm's money-lending business or that they became irrecoverable in the year claimed. Where an assessee, being assessed under the ordinary procedure, seeks to deduct an amount from declared profits as a bad debt, the evidential burden rests on the assessee to prove the nature, origin and that the debt became bad in the year of account; mere after-produced extracts or documents not placed before the tax authorities cannot be relied upon on a Section 66 reference to revise factual findings.

Conclusion: The deduction for bad debts was not established on the evidence and the Commissioner was correct to disallow it; the decision is against the assessee.

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